Scoopon Is Going To Court For Allegedly Misleading Both Customers And Partners

Group-buying site Scoopon is facing court action over complaints that it misled consumers about prices and their voucher redemption rights, while misleading businesses about the number of vouchers that were likely to be redeemed.

Australia’s competition watchdog said it had received “a significant number of complaints” about Scoopon since it launched in 2010.

The ACCC said Scoopon had misled customers about their ability to redeem vouchers, their refund rights, and “the price of goods advertised in relation to some of its deals”.

In advertisements, Scoopon compares its prices to what it says is the non-discounted price of the same product or service, to show customers that they are receiving large discounts.

Scoopon charges businesses a fee for selling vouchers on its site. The ACCC says Scoopon misled businesses by telling them that “there was no cost or risk involved” in running a deal with Scoopon.

Scoopon also told businesses that only 70%-80% of vouchers would be redeemed, when “there was no reasonable basis for this representation”, the ACCC alleges.

Scoopon is owned by CatchoftheDay, which was founded by Hezi Leibovich and is backed by investors including James Packer and seek founder Andre Bassat, the Australian reports.

The ACCC is seeking declarations, injunctions, community service orders, penalties and costs. The case has been filed in the Federal Court in Brisbane.